Podcast | How to Supercharge Your Brand: Making Your Planogram Insights Go Further

[00:00:00] [Sam]: Thanks everybody for joining us on dunnhumby’s category management podcast. In the first three episodes, if you’ve listened to them, and I really encourage you to listen to them if you haven’t, we’ve really spoken about how to use planograms in today’s world and how to make the most of them and use them most effectively. Today we’re really going to shift away from that and move away from talking about category management to category growth and how these can really help us all grow. So, delighted I’m here with Nick. Nick, can you introduce yourself and tell us a little bit around why you’re so passionate about the power of planograms?

[00:00:35] [Nick]: Yeah, thanks Sam. So my name’s Nick. I’m the founder and CEO of VST. We created planogram publisher a couple of years ago now. And for us, the real purpose of this was that the shelf is important. It’s where over 90% of sales go through for most categories. So in store is important, but the shelf is just as important as that. We see that about 63% of shoppers are influenceable at shelf. So 37% are going in with a shopping list and they’re deciding exactly what they want. Obviously differs a bit by category, but 63% of those shoppers are influenceable. So the shelf is really important and what guides the shelf, well, it’s the planogram.

[00:01:16] [Nick]: So, for us, we saw previously, planogram data access was pretty tough. So some retailers would share this but pretty sporadically. So it would be shared in PDF documentation, for example. So brands were still having to go out and actually look in a store, take photos and try and digest what was going on with that. It was just a bad way of sharing that data really. And so we looked at this and said, this planogram data, it brings all of this additional value to the retailer and to the brand. So how can we make this more available in a clean, consistent data model. I know clean consistent data model isn’t necessarily the sexiest of terms that people get excited about, but for the value that we can see, it it really brings a lot to those brands.

[00:01:53] [Nick]: Obviously, we launched this with dunnhumby and Tesco a couple of years ago as the first retailer really to move on this across the globe. So really exciting and for us, we’ve seen so many benefits coming to brands from that. So let me fire a question back to you, which is why did you decide to make that change at dunnhumby to start working with planograms in that way?

[00:02:16] [Sam]: Obviously, it’s been great working with you having with your dunnhumby knowledge and coming back into the business as a partner. Ultimately for me, it all comes back to our job in dunnhumby is to make sure that there are changes at the shelf edge and changes that are brilliant for customers, changes that deliver brand growth objectives and that deliver retailers category growth objectives. And it’s therefore a little bit of a gap. You know, dunnhumby’s always been, I think well positioned with our data sets and our data science to really understand what the opportunities are with customers, what customers want, how to activate it, what the right promotions are, what the right range is, but actually how that shows up on shelf is so important and so important for making sure that customers have a good experience.

[00:02:58] [Sam]: So planograms was a bit of a gap for us in terms of making sure that we were able to offer that full service, I guess, um to our clients. So it’s been great. Can you tell us a little bit more about the scale of planograms and kind of what you’ve learned over that journey working with them more closely?

[00:03:17] [Nick]: It’s a really complex data set and I think that’s the main reason why a lot of this planogram data hasn’t been shared with brands previously. So within Tesco alone, it’s a data set of a few years worth of data now, over seven and a half billion rows of data that we now capture and is updated every week from there. It’s a huge data set. What that translates to is about six and a half thousand planograms across the total grocery estate just within Tesco within the UK. And these are really getting more complex over time as well.

[00:03:47] [Nick]: To try and keep up with those shopper missions and evolve to meet those complex shopper needs, we’re seeing more and more of a move to store specific plans and it’s the right thing to be doing, operationally more complex to do so, but so many things like planogram publisher are helping us really hit those needs. I think we’re seeing a lot of brands who and retailers who talk about the planogram, but actually for us it’s always the idea of the planogram doesn’t really exist anymore. What used to be the most common plan, the largest and the smallest that we’d used to plan these with, actually it’s not going to exist anymore as we move more and more towards store specific planogramming and that’s cloud-based ability to see what these products look like on shelf really allows us to understand that at a much, much broader level.

[00:04:35] [Sam]: I think that hyper relevant, hyper localized offering for all retailers and obviously particularly Tesco is so valuable to being able to deliver against every single customer’s needs and planograms clearly a massive but very complex part of that. I know we’ve spoken in in previous podcasts around kind of how we make sure that that shows up and works effectively and very kind of seamless activation. But be great to talk a little bit more around the some of the other things that we can unlock with it. We’ve heard a lot about innovation in the industry recently. It’s come out really clearly as one of the biggest opportunities for retailers and brands. So should we start there? How do you see planograms as um the role they can play in innovation?

[00:05:17] [Nick]: Really integral. So what we’ve seen over the last few years, a lot of talk about inflation and it’s been really difficult for the industry to be able to meet those shopper needs. But what we’ve really seen over the last six months is that shoppers are starting to turn back to understanding new products and trying to identify new products and really keen to embrace that innovation as well. So what we’ve seen is now that uh it’s as much as one in two shoppers have actually tried a new product just within the last month.

[00:05:46] [Nick]: And where do they find that? A lot of people will find out about this online, but many of those are actually going to find out about it when they’re actually at the shelf. And they’re typically finding it because the value is communicated there for them or because it looks interesting. It’s literally the words that these people use. It looked interesting. And so for us, how do you make it look interesting? It’s at the shelf. So you need to make it stand out and it needs to be a different colour to use like the most easy to use example for this or it needs to have the right communication on shelf or be supported by signage, whatever that might be. But that’s the really way really the way to kind of find and match and display that growing trend within this.

[00:06:31] [Nick]: And so I think there’s so many of these trends that we read about that we have seen across the store and I guess from your experience Sam seeing so many of these areas. What kind of these are there any examples of these trends that you think are really standing out for us right now?

[00:06:48] [Sam]: There’s so many aren’t there? There’s the kind of near term ones where we’ve really seen them and we’re that we’re kind of sure of them and over the years we’ve obviously had protein and we we’ve kind of gone past peak protein where every product had protein injected into it. But we’re now at a different phase where we’re thinking a little bit more around what’s the macro space and how should protein be ranged and should it have specific areas. We’ve obviously seen some famous ones on energy drinks. But I think some of the interesting ones now, probably be good to get your views on it are things like celebrities, things like the range of GLP um ones and of course Dubai chocolate. So where do you see some of those fitting into this and are they are they the next big thing or actually are they just a flash in the pan?

[00:07:37] [Nick]: I think we’ve seen so many of these recently where retailers and brands have been doing a great job at using this data to try and match those trends that suddenly just take off so quickly online and the kind of viral trends as you mentioned the Dubai chocolate and now we’re seeing pistachio and everything, which is amazing that people have been able to keep up with this so quickly. And energy drinks, I think we can go back a couple of years to see how prime energy just absolutely took the market by storm and has fallen off pretty quickly soon after that as well. But really, it’s how you secure the shelf space to meet that growing trend.

[00:08:14] [Nick]: And so yes, you can do that off the main display, off the shelf, so on corners of aisles to do so. But actually, through being able to work out when you know what’s actually on the shelf and you can actually visualize that as if you were a shopper with the right planogram data feed, you can now start saying, well actually, where should this go? How do I highlight this? Is this at eye line? Is this at a separate part of the shelf which is focused on new stuff, innovation, and how do we direct shoppers to actually go to that bit of the shelf. If this is their specific mission, I want to find something interesting, then which part of the shelf do I go to and how do I guide shoppers to hit that.

[00:08:52] [Nick]: So I think areas like energy drinks and pistachio chocolate is going to be great for this. But then the advent of things like the impact of GLP ones is a fascinating area for us that could actually influence the entire store. So whilst we’re seeing that as growth in terms of how shoppers want to buy food in the future, it’s something we need to be mindful of across fresh, across frozen, across ambient grocery as well and getting the right range of products for that specific shopper.

[00:09:23] [Nick]: However, it’s not something that I think we need to be worried about in operationally. Teams have done such a great job with free from ranges for instance in the past and I think that is probably the best trend we can see. Is that going to be a separate part of the store or actually is that going to be integrated into each of the specific categories itself. Those are the things that we can test and start understanding about what is the occasion or what is the mission of that shopper. I know that’s mission area is something that you guys have been really interested in at dunnhumby as well.

[00:09:52] [Sam]: Yeah, and I think some of those trends are brilliant and they’re really going to be brilliant for brilliant for shoppers and brilliant opportunities for brands and retailers. But I think that where you start looking at you know, where’s the right for occasions based ranging actually is where you become relevant for all shoppers rather than rather than some and when you can really tap into making sure that we’re making it really easy for shoppers to buy for the specific trip that they’re on, the specific occasion that they are shopping for. You know, ultimately that’s got a benefit to everyone.

[00:10:22] [Sam]: We’ve got examples of that. You’ve got front of store for meal deal, you’ve obviously got meal for tonight and some of that. But I think when you start going a bit more broad than that or really casting the net a little bit wider in terms of the types of occasions that we’re delivering for and ranging for, you really get an enhanced shopping experience for shoppers that that could be really, really crucial as a as a growth engine. And some of the other ones that I’m interested in are how do things like brand blocking fit into there? So I don’t know what your experience has been with actually the role of brand blocking and where that works and where that where that doesn’t?

[00:11:02] [Nick]: Yeah, we’ve seen it work and we’ve also seen it not work. As I’m sure you can guess. And we’ve seen some of these brands it’s as always goes back to does it meet a shopper need. So whilst we can see some really stunningly good looking fixtures and I kind of go back to seeing a display of Pringles in a store for example, vertically based, beautiful, colourful shelves. Does that actually work in store? Does that meet a shopper need? Well actually quite often because we see a Pringle shopper is quite a specific Pringle shopper.

[00:11:36] [Nick]: But if we go across some other areas then actually you might want a colour coded bay which is based on a brand, but it might not be what that shopper wants to see. They might want to explore across those different brands as well. Obviously there’s a media play, there’s a simplicity play that I know where these products are supposed to go, but it really does become quite category dependent in there.

[00:11:57] [Sam]: Yeah, it’d be really interesting obviously we’ve seen examples in the past where brand blocking’s been done but it’s been for really, you know, an internal brand objective of showing something that’s together and actually increasingly when we think about it from a customer perspective, we get very different areas that should be and shouldn’t be. So interested to see how that develops over the next few years. And you mentioned media there. I think media is one of the really exciting areas.

[00:12:20] [Sam]: Everyone I’m sure has got retail media on their minds given the amount of focus on it in the industry. And actually increasingly there’s a couple of bits I think are really interesting. There’s whilst retailers are thinking about where to put stores, where to put POS, where to use different signage around the store to drive the shopper to where they’re trying to get to. I think there’s a really interesting one to unpick there. And then also testing of the message and making sure that we’re landing really interesting, relevant messages that have the right call to action for customers. There’s a real opportunity there to make sure that we’re not wasting any brand investment and getting the most relevant message out there.

[00:12:56] [Nick]: Yeah, really interesting. I think from a an infrastructure perspective, I’m always talking about the most exciting things, right? When it comes to actual media here as well, I think we’ve seen so much with digital screens and investment from retailers to get those digital screens in store. How that interacts with the planogram is so important. And if I can make a prediction on this, I think over the next year, maybe two years, the interaction between those digital screens and the planograms are going to become fundamental as to how you can win in retail media.

[00:13:27] [Nick]: At the moment it’s quite separated, understandably so with how quickly the retail media focus has kind of shifted onto it. But actually how this can start working operationally and make sure that you are communicating the right brand message over the correct brand over something that might actually be sat in a different part of the store. I think that is going to be where brands need to be spending their money and where retailers really need to focus operationally to make this a win-win win.

[00:13:57] [Sam]: Yeah, brilliant. And that’s a really nice segue I think because we’ve been talking kind of upper funnel, some of the trends, some of the different occasions that we might want to start using planograms to support on. But ultimately it is all about the operations, it’s all about the execution, making sure that product’s in store. So maybe there’s a bit more we could unpick there. So if we go back to innovation, when you get to the quite specifics of the execution, how do you see it being used?

[00:14:21] [Nick]: Innovation and planogram data go really hand in hand and from our perspective at VST was where we really started out was in this world of shopper research. It was this idea of how do we test a layout or pricing or promotions or a new product placement on shelf and really make sure that we can test it in front of shoppers before you necessarily have to launch it in a store. So unfortunately you can’t do that without a good feed of planogram data. This is what enables everything else. Planogram data is the foundation that you can then start building virtual stores and understanding and research on top of.

[00:14:56] [Nick]: So you can start asking shoppers to interact with it in the way that they would in store or what they think of certain things or what their attitudes or behaviours are when it comes to these specific features. Are they able to find the products that they need? Are they good enough value for money? Will they spend more or will they spend less or will they keep coming back to the store with the offering in the same way as it is at the moment.

[00:15:19] [Sam]: Yeah, brilliant. It’s all those details that really determine the long-term success, right? And how long they stay in the range and stay delivering with customers. I’m really interested in that. If we keep on that theme of execution then, what are some of the other themes that you think will come through with the enhanced use of planogram data?

[00:15:43] [Nick]: We’ve seen a lot of usage in the world of category management about what we can do with planogram data. And we’ve had some really forward thinking people on this podcast as we go through in previous episodes as well. But for me, the way I really see this going is the execution part is often forgotten about or has been previously when it comes to category management. I think we really want to start looking at category management turning into the idea of category growth and I think we need that kind of marketing rebrand that we need to do for all of our teams to do so.

[00:16:20] [Nick]: And it should be the responsibility of category management or category growth to execute this in this kind of closed loop measurement they need to focus on. Even to things like field sales. And I think field sales, field marketing now needs to report into that line of category growth because that is how you reach the shopper and make sure that you are landing that shopper in there as well.

[00:16:44] [Sam]: I love that idea of the transition of category management to category growth or category growth management, yeah. You wouldn’t call it revenue management, you call it revenue growth management and we should be doing exactly the same in category. So absolutely on the same page there. I think that again the point you made there around how do we close the loop? How do we measure it? How do we make sure that we are executing every single one or as many of the possible relevant recommendations that category managers are making into retailers. We’re landing them, we’re actioning them, we’re measuring them and we’re reporting back.

[00:17:20] [Sam]: And I think that whilst we’re good at that today in the category management industry, I think there’s a real opportunity to not just execute more, activate more, but also measure, measure more. So I love that suggestion of field sales going in there. Obviously we’ve been speaking a lot about the in store experience, but actually all of us know that, you know, e-commerce, quick commerce is not just a trend but a really integral part of the shopping experience. Are planograms relevant there?

[00:17:55] [Nick]: Super relevant. We’ve seen a large shift within certain retailers to fulfillment centers. So how can we lay out shelves within a big warehouse to enable picking from those to make it as quick as possible. But of course, we have seen globally as well, so many retailers, the e-commerce is fulfilled from the actual store. So much so that actually how do we lay out this planogram in store for certain stores that now have a higher percentage of sales that go through on e-commerce and are actually picked in store than actual shoppers going into that store.

[00:18:35] [Nick]: What should the planogram be? Should it focus on making it easy for the pickers in store or should it be focused on the actual shopping experience that we all do this thing for as a retailer anyway? And actually because the answer is that it should be more focused operationally for pickers. However, if you’re creating that worst shopping experience, is that something you can go back on. So for example, what we would see is rather than laying out all of your ketchups together and all of your mayonnaise next to that, you would actually splice it so you have one small ketchup, one small mayonnaise, a medium ketchup, medium mayonnaise, etc, etc to make it really easy to pick out for an e-commerce picker. But for a shopper, you’d go and think these people are mad. Why are you laying it out in this layout here.

[00:19:24] [Nick]: So operationally there’s a lot that we can do there. And then of course it’s a totally different ball game again for something like quick commerce, which I know is a focus for you guys with dunnhumby at the moment.

[00:19:36] [Sam]: For sure and with all retailers that we work with, obviously Tesco being one of them. And I think the as you say the it’s mind blowing that there’s some big stores where there’s more e-commerce shops being picked than there are in store in store shoppers. But certainly with quick commerce and the role it plays in convenience and big stores from a picking point of view and the commitment to getting that product to the customer within a certain time frame, I think represents some really interesting opportunities when thinking about the specific categories and products and even brands that over index from a quick commerce perspective and actually how do we make sure that those are given the right place in the planogram that ensures that it both meets the in store shopping need, doesn’t in any way detract from it, but also ensures that that picking can be done really hyper efficiently and make sure those time, obviously the kind of key time deliverable is met. Fascinating.

[00:20:04] [Sam]: I guess that also leads to one other point which we haven’t really explored is actually what about for those in store shoppers? And actually I think we’ve all had that experience of not being able to find what we’re looking for in a store. Mine’s always falafel. I can never find where falafel are in a store. What role could planograms play in actually helping to be beneficial or accretive to that in store experience finding products?

[00:20:35] [Nick]: Yeah, I think if we’re doing a good job with our planograms then you can find that product everywhere you can go and it’s about making sure that it’s clear and obvious. Where we are really focused as a team at the moment is how can we start using that data to make sure that we can put those products within the right categories. And so rather than being placed in five different locations across a store for example, making sure that it is clear where you’re supposed to go.

[00:21:03] [Nick]: And obviously that’s different across fresh and frozen and kind of limiting with equipment types for example. But across the ambient grocery stages, we need to make this as quick as possible. I think we got some really good experience on this during Covid times actually is where we learned a lot, which was we need to get shoppers in and out of stores as quickly as possible to keep them safe. And every retailer did such a good job at really kind of simplifying the range over that time for it.

[00:21:19] [Nick]: But for us it’s how can we use the vast suite of tools and the vast data that is available to us across planogram data, but not just planogram data, across shopper attitudes, research, across all of the other dunnhumby suite of tools to make sure that we are making it as streamlined as possible.

[00:21:44] [Sam]: The future is definitely joined, right? And it’s about how we effectively combine data sets rather than think about them in isolation. I think that’s really clear and really powerful. We promised we would talk then around the future. So we’ve started talking about category management transitioning to category growth. What else does that future look like when you think about it?

[00:22:15] [Nick]: I think we’ve done a wonderful job to go this long without mentioning AI. And that is of course where we really want to take this in the future. You can only really build AI on good, clean, consistent data formats. And we’ve spent a lot of time cleaning and making that a consistent data format and understanding the use cases that CPGs really can benefit from with retailer planogram data. So everything from making this a lot more proactive. How do we create predictive planograms? How do we understand what shoppers will want in six months time or two years time, three years time with all of the flavour profiling that goes into that. And then I think it’s all about how we can use that planogram data as the base foundation and start building other areas on. I would also Sam love to get your thoughts on it.

[00:22:54] [Sam]: Ultimately, I think the us as an industry, we need to be able to make better decisions and we’ve spoken a little bit about that, but also we need to make faster decisions. We need to make decisions that lead to action. I think when we look across the industry, you know a lot of there’s a lot of great work that never gets actioned, never goes back to that do we see something different on the shelf in the store, whether that’s a physical store or a digital store. And I think that’s really where I see the category management, so category growth industry going and that’s how do we make sure that we’re making better decisions, we’re making them faster, we’re making sure a faster percentage or a higher percentage of them sorry are activated and then going back to that point we’re talking about a little bit before, we’re making sure we measure absolutely everything and course correct, make those different decisions. And I think that’s um better, faster and measured is where I’m really thinking about seeing it going and I think it’s very clear that planograms play a role in that, but it’s all about how they don’t work in isolation but work with all the other data sets and inputs that we that we have.

00:23:49 [Nick]: Totally agree.

[00:23:54] [Sam]: Nice. So Nick, any final thoughts on planograms, category growth and what we should be doing differently?

[00:24:03] [Nick]: Sam, I’m sure we could talk all day about and where we want to take this in the future. Um but we would really just, you know, as a product software product that is two, two and a half years old at the moment, we’re always on the lookout for exciting new use cases, interesting things of how this is being implemented. So it’s still a product that is evolving and still being built for the future. We would love to hear from any of our clients or prospective clients about how do you want to use this product either now or in the future. So please would encourage people to get in contact with us to let us know our DMs are always open as young people say, I believe.

[00:24:34] [Sam]: Excellent. Thank you Nick. It’s been brilliant chatting and talking through the future of category growth.

[00:24:40] [Nick]: Thank you very much.